Home References Reactivating Dormant Customers

Owing to a steady proliferation of competing telecom services, customer loyalty has got more reasons than ever to shift quickly from one service provider to other. The operators design the customer acquisition campaigns in order to attract high volume of customers within a short period of time but, it is to be noted that customer loyalty needs more attention from the operators as compared to acquisition. The experts have found that it is much easier to retain existing customers than to win new ones. Acquiring a new customer can cost 6 to 7 times more than retaining a new one and the existing customers are five to ten times more likely to avail a product/service again than people who have never bought it before.

The new-age telecommunication ecosystem demands an altogether newer approach in order to compete with the other players on the ground and retain their existing customer base preventing customer churn. Thus, reducing dormant customer base and increasing customer loyalty through omni-channel presence and winback effortsis at the top of every telecom operator’s to-do list today.

The concept of customer churn

While a service provider stays focused on winning new businesses through customer acquisition, their existing subscribers fade into the background, which is quickly followed by them becoming easy targets to be wooed away by the service offers of the competing service provider.

It is utmost important to find out ‘why does a customer go dormant?’ as ultimately this leads to customer churn.

Top 5 reasons for churn of dormant customers:

  1. This may be the same reason why there have been existing a lot of dormant customers – unsatisfactory customer service/experience, no omni-channel presence, low quality of products/service or even inaccessibility.
  2. Lack of benchmarking in terms of service quality as well as costs against competitors.
  3. Lack of attractive offers and rewards to push them for service renewal.
  4. Exhaustive service and support channel for the customers to interact with. Not learning what the customers like and what they don’t like about the service and keeping an issue unresolved ultimately leads to customer churn.
  5. Another reason may be that the customer has developed apathy for your service/brand due to lesser interactions.

Re-activating dormant customers- INFOGRAPHIC

Why is targeting of inactive customers important?

If a service provider has already spent their time and money with a particular customer base and has given it several promotions in order to make the customers feel special and valued, then there are greater chances of them becoming a returning customer as compared to the chances of getting a new customer on board. The reasons being:

  • They already bought product/services from that particular service provider and so their (customer’s) purchase preferences and buying habits are already known.
  • Since, the service provider already has access to their direct contact, they don’t need to do any lead generation.
  • Plus, the promotional offers can be customized based on the past data.

 

Researchers have found that an average telecom service provider loses between 15 to 30 per cent of its customer base every year and the existing customers have greater chances to renew a subscription again as compared getting new people on board to avail a particular service.It is therefore, justifiable for the operators to focus of re-activating their existing customer base. And thus, prioritizing the targeting of idle customers through omni-channel presence, loyalty management solutions and win back services makes quite a sense to astutely balance customer acquisition and re-activation strategies simultaneously.

 

Winning back dormant customers

The identification and re-engagement of dormant customers serves a great purpose for the telcos. The inactive customers are a great source of reactivating lost revenue opportunities. Thus, the service providers are continuing to breach new frontiers of engagement and redefining customer retention with omni-channel presence approach, loyalty management and winback solutions.

An omni-channel approach in telecom not only opens up new channels for customer service but also it ensures the delivery and management of consistent satisfactory experience and service levels through a set of channels used to enhance the subscriber’s usage journey.

Alongside, developing loyalty management strategies for all phases of customer engagement is proven to be quite effective in order to prevent customers from being inactive or end a subscription. Allowing the customers to earn reward points based on their purchase value and service consumption patterns is an efficient way to motivate them to spend more and drive a profitable behaviour. In comparison to the standard customer re-activation solutions, the loyalty management solutions use real-time tracking to take proactive actions making positive interventions to prevent activity drop thereby improving revenues. Reaching out to the lapsed telecom customers on the basis of their usage and subscription history helps the mobile service providers to assure higher reach and conversion. Thus, the proactive recovery of dormant customers enables a positive word of mouth improving the reach rate and revenue.

Another way- the network listener methodology- enables the service provider to tap into network events to identify the best moment to deliver relevant offers. For instance, the dormant telecom subscribers receive an offer instantly the moment they see their mobile device, thus, generating more revenue by improving responsiveness. This not only convinces the subscriber that the operator understands them well but also it creates a push for them to re-engage with the services.

Some tips to winbacktelecom customer base:

  1. Use customer’s subscription history to drive customer interactions.
  2. Provide omni-channel service as well as customer support.
  3. Identify a control group and isolate customers for inference testing.
  4. Identify the exact period for lapsed interaction based on the service’s purchasing cycle and use inference to plan future engagement strategies.
  5. Make easy and interactive communications and take a lifetime value approach.
  6. Loyalty programs, discounts, promotional offers, winback programs may always help.

Summary

There exist multiple evidences to support that rather than using resources for chasing new subscribers it can be quite beneficial for an operator to reactivate existing leads that are about to churn. Customer churn is inversely proportional to the growth of a service provider.  Thus, preventing churn using new-age concepts like loyalty management to interact with the existing customer base may certainly help in increasing the ARPU and overall profitability of a telecom operator exponentially as they are proved to be efficient enough to influence the buying behaviour of dormant customers.

You may also like

Leave a Comment